End your car lease without getting dinged

by PHILIP REED, NerdWallet

Chevrolet Camaros are lined up in the lot of a Chevrolet dealership in Richmond, Va. As the end of your car lease approaches, you may start to see every scratch, stain and extra mile as another dollar coming out of your pocket. But by learning how the lease-ending process works, and what damage you’re likely to be charged for, you can avoid excess wear and tear on your wallet. (AP Photo/Steve Helber)

Your car lease is ending soon. Looking at the dent in the driver's door, you wonder if you'll be charged for it. Or maybe you've exceeded the mileage limit and you're bracing for a big hit. But you can avoid common issues like these if you know how the game is played.

Many people incorrectly assume leasing companies will gouge them for every little dent and ding, says Jeff Huang, a remarketing representative at Westlake Financial Services, a financing company that works with dealerships. And for obvious problems — deep scratches or stains in the upholstery — he says a little "sweat equity" can head off extra charges.

IN THE 'HOT ZONE'

The last 90 days of a lease is the "hot zone," according to Hall. During this time, the leasing company will likely contact you about your options, including offers designed to keep your business. You can:

Buy the car

Return the car to the leasing company

Lease another car

Extend your lease contract on a month-by-month basis

The leasing company will remind you of the buyout price (set at the beginning of your contract) and provide the contact information of the lease inspection service it works with so you can schedule an inspection appointment.

'EXCESSIVE WEAR AND TEAR'

Before the inspection you can figure out what sort of damage the leasing company is looking for. "A good place to start is to go to the manufacturer's website and read what they allow," Hall says.

For example, Toyota's "Wear and Use Guidelines" show what damage to the car's interior, exterior, tires, glass and lights a customer might be charged for. Financing company Ally Financial Inc. also offers a handy checklist for lease returns. Many manufacturers say they'll charge customers for any scratches or dents larger than a credit card.

Before the inspection, clean the car and remove all personal items. "Basically, you want the car to have curb appeal," Huang says. "You want the inspector to have the immediate feeling that the car's been well cared for."

The inspector works for a third-party company and has nothing to gain by finding all sorts of problems, Huang says. You can address any issues the inspector finds and request a second inspection. Or, if your time is worth more than money, turn your car in and pay the repair charges.

PREEMPTIVE REPAIRS

You can fix some problems yourself and possibly save some money in the process. Deep scratches can often be remedied with some touch-up paint, an artist's brush and a steady hand. Stains may come off with stain remover, upholstery cleaner and some scrubbing.

You can also pay for repairs independently before turning in your car. While you may not save much, you'll know the cost upfront. For instance, hiring a professional paintless dent remover can work wonders; several small dents can often be smoothed over for about $200.

Tire wear is another concern for lease customers, Huang says. After three years of driving, reduced tread depth can easily warrant a new set of tires, an expensive replacement.

That's why some car experts recommend replacing the tires two years into a three-year lease. That way, leaseholders get to use some of the tires' life and won't get dinged for new rubber when they turn in the leased car.

EXCESS MILEAGE

Most leasing companies charge around 15 to 20 cents per mile over the amount allowed in the contract, commonly 12,000 miles per year. If you're way over the allowed mileage and looking at a big penalty, you still have options.

If you like the car, you can buy it rather than pay the mileage penalty. In most cases, the buyout price is close to the current market value price.

Another strategy is to check the manufacturer's website for "lease pull ahead" offers. Such deals let you end your current lease and start a new car lease from the same manufacturer. To make a deal — and keep your business — the dealer may forgive some extra miles and damage. You may also avoid regular lease-end fees, like the $350 to $500 or more disposition fee, the charge to prepare the car for resale.

"Dealers and lease companies don't want you to end your lease and walk away," Hall says. "They want to keep you in the family."

This article was provided to The Associated Press by the personal finance website NerdWallet. Philip Reed is a staff writer at NerdWallet. Email: preed@nerdwallet.com.